Trading against the Apple apathy

Flip it. Be contrarian.

A good friend of mine who used to be a bigwig over at Google and now is a bigwig at a startup and who is a subscriber to TradingWithCody.com wrote to me the following after reading last week’s full transcript to our more recent “Live Q&A with Cody.”

Holy moly. No questions on AAPL? If that’s not a contrary indicator I don’t know what is! Give me a little more of ‘dem apples! Congratulations again on the marriage. Many years of happiness to come. – David

Cody, I am beyond disgusted with this stock. It cannot muster any momentum even on a green day. It’s only pop this year was when Einhorn went public with his lawsuit. Would appreciate some really meaty analysis on what you see with the company, the stock price and what it will take to turn the perception. Holding a hundred shares is a weight on my account when I could be using it for better plays. Thanks, LP.

I’ve mentioned before that I’ve seen pullbacks in Apple that lasted longer and went deeper than even the current 30% drawdown from Apple’s all-time high. I’ve been following Apple over the years since I owned it from $7 in March 2003. I was wrong to think that the stock would pop right back to $700 after a strong “iXmas” selling season and a historical record earnings for a tech company in last quarter’s earnings report. Alas, I would venture that my bud, ex-Googlite David, is onto something about looking at Apple as a potential popper in the near- and mid-term.

They say the opposite of love isn’t hate but apathy. At six times this year’s earnings when you account for the $140 billion in cash on their balance sheet, there’s either a lot of hate or a lot of apathy or a lot of both about this stock.

I’m going to, yes, add a little more Apple common here to my portfolio, and if this stock can ever get some mojo back towards $500 again, I might even be willing to go back in for a new round of Apple call options, which over the years have been very, very good to me and my investors and subscribers, even if I was dead wrong when I bought some in December. Speaking of which, I’m going to look to trim back some of my Google calls which I bought a few weeks ago. Still holding all my common, some of which I’ve owned for years, in Google
/quotes/zigman/93888/quotes/nls/googGOOG for now. Along with that Goog, there are a few select techs still powering higher, including Oracle and Cisco.

Nobody said it was easy being cheesy. Or contrarian. And before I go, I want to personally invite each and all of my Cody Word readers on MarketWatch to come check out our new TradingWithCody Social Network and revamped site. Come see what all the fuss is about!

This copy is for your personal, non-commercial use only. Distribution and use of
this material are governed by our
Subscriber Agreement
and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones
Reprints at 1-800-843-0008 or visit